Owners and managers of retail stores worry about shrinkage in terms of in-store theft and vendor fraud, but often overlook another type of theft—slippage at the fueling station.
Whether your retail store can count its company vehicles on one hand or you manage a small fleet, it is essential to understand how fleet/fuel cards can help prevent slippage and how to educate your employees about best practices when they fuel up.
A high slippage rate—like a high shrink rate—can take a significant bite out of your bottom line. Please keep reading to better understand how to fight slippage and maximize your profits with fleet and fuel cards.
So What Exactly Is Slippage?
Automotive Fleet Magazine defines slippage as when an employee uses company dollars to purchase non-fuel items such as food and drinks, but falsely reports it as a legitimate fuel purchase.
Say, for example, you run a garden supply store with multiple drivers out in the field making deliveries. That driver has a company card they use for fueling. If you don’t have a robust system in place for monitoring fuel spend, there’s always the chance that a driver is making non-authorized purchases that you cannot differentiate from fuel spend. This is slippage, and even if it’s only a few cups of coffee a day, it adds up over time.
How to Stop Slippage
The fight against slippage begins by choosing a smart fleet/fuel card solution that allows you to set purchase limits and other controls that work best for your business.
“When fleet managers establish controls across the fleet and for individual drivers, they can restrict the types of purchases, the number of transactions, the dollar limits, frequency per day or per cycle, and even the hours of purchase,” Marie LeMoine, senior vice president in the corporate payment global transportation group at U.S. Bank Voyager, told Automotive Fleet. “These proactively help to prevent fraud and misuse, but also protect the bottom line.”
Fuel More Securely
WEX offers fuel cards for small businesses that allow you to set your own purchase limits to put guardrails on employee spending based on dollar amount, product type, location, and more. Driver IDs are entered for every transaction — for security and transparency — so that you always know who spends what, where, and when.
With WEX fleet and fuel card solutions, you also get automatic accounting. Details like driver, odometer reading, sales tax, and more are captured for every purchase, so you can stop hunting down fuel receipts.
Stop Misuse as Well as Slippage
Misuse, which Automotive Fleet defines as employees using company resources for personal gain, such as fueling a personal vehicle or filling a friend or family member’s vehicle, can be even more costly than slippage.
Again, smart fuel cards combined with employee education are the best way to combat misuse. But to get the full benefit of a fuel card program, you must regularly monitor your fuel card accounts. Make sure to watch for charges that don’t add up either from a dollar amount or a geographic standpoint.
“These types of anomalies are red flags and may also indicate the need for stronger controls,” Marie LeMoine told Automotive Fleet. “For example, if your drivers don’t work on weekends, then fueling on those days should not be allowed. If drivers don’t go to certain states or regions, then purchases should be restricted to only their travel area. These precautions pay off and only take seconds to set up.”